Rehab a Fixer Rental Property:

1. Market and/or research to find the deal – slog through hundreds of listings, find the comparative sales for each one, drive to and walk through each one to check them out.

2. Buy it using your own money or hard money. If you’re using hard money, then you have to go through the whole process of qualifying for the hard money loan. Feel grateful that they’re lending you money at a 15% interest rate and 5 points.

3. Figure out what needs to be done to the property, being careful not to do too much or not enough.

4. Get all the utilities turned on. In some cities, you have to do this in person.

5. Make appointments with a bunch of tradespeople like painters, carpenters, electricians, plumbers, landscapers, etc. Hope they show up for the appointment. If they do, walk through the house with each one and explain what you want done. Then listen as each one gives you a completely different opinion on what the best thing to do is and why anyone else’s idea is a bad one.

6. Get the quotes, call their references, and then negotiate with each tradesperson to get the best possible price. Hire them and hope it wasn’t their sister you were talking to as a reference.

7. Show up at the property at least twice a day to make sure the work is getting done. When you get there and no one is there, start making phone calls to find out what’s going on. Listen to a story about why they aren’t there. Be firm, but don’t get nasty, and tell them your project is important and needs to get done. Show up the next day and do it all over again.

8. Deal with the unexpected issues that come up along the way. You thought the furnace was working but since the gas wasn’t turned on when you bought it, you couldn’t tell. Go back to #6. Or the bathroom floor you were going to re-tile needs a new subfloor. The price from your carpenter seems kinda high but what are you going to do, he’s already in there doing the other work. Add $5000 to the rehab budget.

9. The property is finally ready to rent. You either hire a leasing agent or market the rental yourself, which means you either pay a month’s rent to find a tenant or take a bunch of calls, spend time saying the same exact thing over and over to each prospective tenant and trotting out to the house each time someone wants to see it. You collect an application fee, run credit/eviction reports, call references (being careful about sisters again) and finally…finally…Yippee!, you now have a tenant.

10. Start collecting rent checks.

Turnkey Rental Property:

1. Buy the property.

2. Start collecting rent checks.

I’ve done both, I pick turnkey! Call me to talk some more about the differences.

Fixer vs. Turnkey Rental Property – Which is Better? is a post from: Positive Cash Flow Investing

While a lot of people who put money into investment real estate property do it as a full-time undertaking, operating as a real estate entrepreneur can take significant amounts of time and effort. To begin with, a person must identify a reasonably- priced property which can be upgraded for resale.

After that, the person will have to buy the property or home, while taking into consideration every bureaucratic, financial, or legal entanglement connected with the property. Subsequently, the individual will have to plan and arrange for repairs and upgrades, while at the same time trying to not go over budget. Ultimately, the individual will have to market the real estate for potential buyers.

Nevertheless, you will find people who have a variety of professional careers who go into the real estate business as a side venture or one-time option. In case you are in the second category, you may well be in a position where your own personal time is really a luxury you just do not want to invest in improving and marketing a real estate asset. You probably currently have a challenging full-time career, along with family members or perhaps local community considerations which take up your time.

For anyone who is in this kind of situation, undertaking every one of the problematic activities on your own is twice as overwhelming. For that reason, you might like to try to make your ultimate investment a totally turnkey property. This would be a piece of property which is entirely all set for purchase, with a property manager and a tenant already in place. In case you have some stressful, high-paying main occupation, a ready-made bit of real estate property can be your best option.

Whenever purchasing a property on your own, you definitely have to check out the house or apartment thoroughly. There exists a likelihood that it might be less sale-ready than the real estate agent or seller may have said. You may additionally wish to hire an attorney, paralegal, or alternate real estate professional to take a look at any contracts you will need to sign, to make certain you aren’t going to be saddled with the previous owner’s legal issues.

Some properties are advertised as turnkey indicating simply that they are in move-in condition. You will still have to put a property manager in place, if you don’t want to manage the property yourself, and maybe even find your own tenant. If you’re looking for a totally turnkey property, look for those properties that have all that work done for you.

It’s possible to find completely turnkey properties with a tenant that has a long-term lease or month-to-month rental agreement already in place, and with a property manager who will handle any day-to- day problems and find another tenant for you when the current one gets ready to move out.

Have you joined our Buyer’s List yet? It takes 2 seconds to sign up to be one of the first who receive our latest turnkey positive cash flow property list. Sometimes our properties don’t even make it to the website because they’re bought that quick.

Make Money on Cheap Homes Buying Turnkey Properties is a post from: Positive Cash Flow Investing

The recession has brought downtown construction to a crawl in many cities, but not Indianapolis.

Boosted mostly by tax-supported projects, Indy’s Downtown is in the midst of a multibillion-dollar construction boom that some say may be among the largest in the nation.

Experts caution that it doesn’t necessarily signal an unusually robust local economy, but the spending comes at a good time — when interest rates and construction costs are low — and it could position the city for growth once economic vitality returns.

According to a new tally recently released by Indianapolis Downtown Inc., 78 projects worth $3.3 billion are under way Downtown, up from $2.8 billion worth of investment as measured in January.

Much of the construction is supported by public sector investments in facilities such as the new Wishard Memorial Hospital, the Indiana Convention Center expansion and renovations of the Birch Bayh Federal Building & U.S. Courthouse and Minton-Capehart Federal Building backed by federal stimulus dollars.

But Downtown and surrounding areas have seen private investment in expansions at Methodist and Riley hospitals, the construction of the 1,000-room JW Marriott hotel complex and additions to the NCAA headquarters.

“Our pipeline of projects continues to grow, even given the economic times we’re facing,” said Terry Sweeney, vice president of real estate development for Indianapolis Downtown Inc., a nonprofit supported by the city that aims to manage, market and develop Downtown.

“What’s equally as impressive is we’re having investment happening throughout the Downtown, and not just in one pocket and not in just one industry, but across the board and across the geographical boundaries of Downtown.”

Tom Murphy, a senior fellow for the Washington-based Urban Land Institute who tracks development in major U.S. cities, called the surge of development in Downtown Indianapolis unusual given the recession.

“To have $3.3 billion in downtown development, that’s the highest number of investment I’ve heard of any place in the country,” said Murphy, a former Pittsburgh mayor. “It’s surprising, but my view is that cities that have any flexibility in their budgets or some entrepreneurship in their leadership, this is the opportunity to make these kinds of investments.

“Interest rates are at a historic low, labor costs are low compared to what they have been in the past, so this is a good time to make these kinds of investments if you can do it.”
Although the building boom bodes well for the future, it’s not necessarily an indicator of health in the local economy, said David Reed, an office manager for commercial real estate firm CB Richard Ellis.

For example, the projects at Wishard, Methodist, Riley Hospital for Children and Clarian Health’s neurosciences center represent a response to consumer demand and are “kind of an anomaly in our economy,” Reed said. In addition, the convention center expansion was approved and had momentum before the recession, and billionaire developer Dean White “had the courage to build the JW Marriott with all cash and push right through a down economy.”

“There’s a lot of great things happening we can point to that have just been wonderful, including the stimulus money and all that has brought along, like the renovation of the federal buildings,” Reed said. “All of these projects are great for the economy and stimulating our economy, but they are not indicative of any recovery in our economy. It’s just good news we can talk about.”

Whether they are an indicator of Central Indiana’s economic health or not, the fact that Indianapolis is developing so heavily in its Downtown sets a tone for other developers in the city, Murphy said, and positions it well to emerge in a stronger position after the recession.

“This says a lot about Indianapolis’ civic leadership, that they didn’t blink when everything started to move downward with the economy,” he said. “I’ve been to a lot of places where the leadership says, ‘Why should we do anything? Look at what’s happening.’ This level of development instills confidence and shows people are willing to step out and take some risk, which is very impressive.”

And not all of the development has been commercial.

The 258-unit Residences at 451 E. Market St. apartment development and the Villaggio at Page Pointe condo development on Virginia Avenue are among the priciest in the city, at $30 million each.

Plus, Sweeney says, a pair of student housing projects near Indiana University-Purdue University Indianapolis on Indiana Avenue are under way and represent a segment of development for Downtown — traditional student-housing construction by private developers, a new trend he predicted would continue over the next two years as IUPUI’s enrollment continues to set records.

Downtown has maintained its steady stream of development for many reasons, Sweeney said.

“We have the foundation of a safe, clean Downtown that has over the years built a well-rounded product that has created a desire from people to live, work and play there, and you layer on top of that the anchors that the local, state and federal government provides along with a major university, an expanding convention center, a retail anchor in Circle Centre, a growing residential base and the hospitals and life sciences that continue to be big drivers,” Sweeney said.

“All of that continues to create this snowball of development.”

Downtown Indy Gets $3.3Billion of Development Investments is a post from: Positive Cash Flow Investing

$400/month Positive Cash Flow is a post from: Positive Cash Flow Investing